Santana Company exchanged equipment used in its manufacturing operations plus R$2,000 in cash for similar equipment used

Question:

Santana Company exchanged equipment used in its manufacturing operations plus R$2,000 in cash for similar equipment used in the operations of Delaware Company. The following information pertains to the exchange.

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Instructions

(a) Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange lacks commercial substance.

(b) Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange has commercial substance.

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Related Book For answer-question

Intermediate Accounting IFRS Edition

ISBN: 9781118443965

2nd Edition

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield

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Question Posted: Mar 23, 2024 08:00 AM

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Santana Company exchanged equipment used in its manufacturing operations plus R$2,000 in cash for similar equipment used

Question:

Equipment (cost) Accumulated depreciation Fair value of equipment Cash given up Santana Co. R$28,000 19,000 13,500 2,000 Delaware Co. R$28,000 10,000 15,500

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Intermediate Accounting IFRS Edition

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